The boss of Costa Coffee and Premier Inn hotels operator Whitbread on Tuesday announced plans to leave by February next year, as the company posted another surge in profits and stepped up its expansion targets. Whitbread's stock market value has grown from 2.5 billion pounds ($3.8 billion) to almost 10 billion pounds since Andy Harrison joined from easyJet as chief executive in September 2010, as it tapped demand from cost-conscious customers for affordable hotels and takeaway coffee.
"I've been a chief executive of three different companies now ... and it's just time to do something that's a bit less demanding," said Harrison, who will become chairman of British homewares retailer Dunelm on July 7. Britain's biggest hotel and coffee shop operator said underlying pretax profit for the year to Feb. 26 was 488.1 million pounds, up 18.5 percent on a year ago and ahead of analysts' average forecast of 478.7 million.
Total revenues rose 13.7 percent to 2.6 billion pounds, with sales at UK Costa stores open over a year up 6 percent and up 9.1 percent on the same basis at Premier Inn. To further capitalise on demand, Whitbread increased its expansion targets for both businesses, with greater exposure in London a key focus for Premier Inn and overseas sales at Costa expected to grow from a quarter to a third of total sales. Shares in the FTSE 100 firm, which hit an all-time high of 5,475 pence on Monday, were down 1.5 percent at 0803 GMT.
"Overall, numbers are ahead of forecast, the group has made a good start to the year and growth milestones have been extended but the market may be unnerved by Mr Harrison's departure," Cenkos analyst Simon French said, tipping Costa Managing Director Chris Rogers to become CEO. Whitbread said it would aim to have 85,000 Premier Inn UK rooms by 2020, up from its previous target of 75,000 by 2018 and against 59,138 rooms currently.
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